Mortgages
NO DOCUMENTATION LOANS
Although lenders generally require certain documentation before approving a loan, if the down payment is sufficient that the lenders feels secured, even in case of default, they will make a mortgage loan without the usual documentation.
| VA loans | no down payment |
| FHA loans | 2.5% down |
| Conventional | 5% or more down |
| No document loans | 35-40% down |
The rule is: The higher the down payment, the less documentation required. If the lender is secured
with a lien on your property and they have already received 40% of the value of the property, they
do not usually require documentation. Some lenders do not make "No Documentation" loans. Our real
estate agents are familiar with lender who will.
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ASSUMPTION LOANS
Rather than going through the usual approval process with a lender, you may be able to assume or "take over" a loan from a home seller.
Prior to 1989, FHA and VA loans were assumable. Many home owners in the Maryland and Virginia market still have these loans. You and your real estate agent may be able to negotiate an assumption of the existing loan without credit check or documentation of income or debt.
When you assume a seller's existing loan, you will have the same interest rate, the same lender, the same terms and conditions that the seller had.
VA loans are still assumable. However, the purchaser will have to qualify and provide documentation for income and debt just as with a new loan. The advantage of assuming an existing VA loan is that the settlement costs are much lower than originating a new mortgage loan, since there are no points, appraisal, credit report fees, or other lender charges. Settlement of an assumption sale is the same as with a new loan.
Conventional loans are not generally assumable. There is a "due on sale" clause in conventional mortgages that would permit the lender to demand payment of the note in full. Many lenders, however, will permit assumption of a loan if you provide proof that you can make the payments. Often, lenders may prefer to permit an assumption buyer take over the payments rather than foreclose on a borrower who can no longer make the payments.
CALCULATOR
Use our real estate mortgage calculator, it will help you learn approximately how much you can borrow to finance your home purchase. This calculation assumes that you have consumer debt payments of no more than ten percent (10%) of your monthly before tax income.
Example:
If your monthly income is $8,000 and your consumer debt (car payment(s), credit card payments, student loan payments) are $800 or less, you are within the guidelines and should qualify. Don't hesitate to contact us if you have questions about qualifying for a home loan. We will go through your income and debt profile and let you know your home purchase price range. If you wish to get pre-qualified for a mortgage prior to searching for your home of choice, we will help you contact an area lender who will, with your permission, obtain a copy of your credit report and send you a letter stating just what you are qualified to borrow.
JUST TYPE IN YOUR ANNUAL INCOME AND PRESS THE CALCULATE BUTTON THE CALCULATOR WILL DO THE REST.
